Lack of homes driving up house prices in Scotland, survey finds

Lack of supply continues to push up housing prices in Scotland and slow down demand, a survey has found.

The latest Royal Institute of Chartered Surveyors Scotland (RICS) residential market survey found demand across the country was flat in March.

Overall, more respondents said house prices continued to rise and were expected to continue doing so in the short term.

A lack of housing stock coming on to the market continues, stretching back almost two years to May 2016.

The March 2018 RICS UK Residential Market Survey found that in Scotland the number of new properties coming on to the market has been falling for a year with a +10% net balance of respondents reporting new sales instructions falling in March.

Survey respondents said the continued shortage of stock is driving up prices, with a +30% net balance noting an increase in headline prices.

The same percentage expected continued growth in this area in the next three months.

Nearly a third (30%) expect sales in Scotland to grow over the same period and in the medium term a net balance of +52% of respondents expect an increase in sales in the next year.

Simon Rubinsohn, RICS chief economist, said: “The latest RICS results provide little encouragement that the drop in housing market activity is likely to be reversed anytime soon.

“Apart from the implications this has for the market itself, it also has the potential to impact the wider economy contributing to a softer trend in household spending.”